This Preliminary Project Proposal (PPP) seeks authorization from the Asset Management Board to lease

a portion of the Boston Government Service Center Complex currently home to the Charles F. Hurley

Building to a private redevelopment partner. This project will leverage the value of the site’s real

estate to offset the ongoing costs of meeting the Commonwealth’s downtown office space needs.

• This project is being proposed by DCAMM, which has care and control of the site, in collaboration

with the Executive Office of Labor and Workforce Development, which is the building’s primary

occupant.

• Lease site covers roughly 3.25 acres.

• Building has $200 million in capital renewal needs.

• Redevelopment partner will be responsible for planning, permitting, and financing redevelopment.

• Providing space to the Commonwealth at competitive rates over the term of the ground lease will

be a condition of the ground lease.

• Ground lease term up to 99 years.

2

Introduction

Exact location and size of the Lease Site within the available area will

be determined upon developer selection and negotiation of a lease.

3

Proposed Area of Offering

• Long-term lease to the Commonwealth

The Commonwealth will benefit from the security of a long-term tenancy or leasehold condominium (up

to 99 years to be coterminous with the ground lease) in improved space at stabilized, below-market rents.

• Improved urban design

By bringing a mix of uses and greater density to the site, re-thinking the street-level experience (including

open space, ground-level retail, and the introduction of a mid-block passageway), and allowing for

selective removal of some or all of the existing building, redevelopment will enliven what is currently a

problematic, moribund block in Downtown Boston.

• A thoughtful approach to historic preservation

Consultation with the Massachusetts Historical Commission with the goal of coming to agreement on an

approach to redevelopment that allows DCAMM to balance historic preservation considerations with our

other goals.

• Economic benefits

As with any other development of its size, this project will create both temporary and permanent jobs, and

will generate tax revenue for both the city and state.

• Transit-oriented development (TOD)

Because of its prime location in Downtown Boston, this development will concentrate new users at a site

that is rich in transit access. As the Commonwealth seeks to address traffic congestion and reduce

greenhouse gas emissions, concentrating development in transit-accessible locations will be key to future

growth.

6

Public Benefits

DCAMM’s main objectives are:

• To redevelop an underperforming asset and problematic site.

• To stabilize and minimize costs by:

1. Leveraging the value of private development to buy down ongoing occupancy costs.

2. Using partnership structure to amortize life cycle costs (initial construction, O&M, capital

renewal).

3. Minimizing one-time capital investment requirements.

4. Applying federal equity towards space for EOLWD agencies.

5. Creating cost-competitive space for state agencies.

6. Reducing exposure to leasing market by increasing space under long-term Commonwealth

control in Downtown Boston.

7

Commonwealth Requirements

• DCAMM’s exact requirements are still TBD with regards to:

– The amount of space the developer will be required to provide to the Commonwealth for

long-term control.

– The amount of parking the developer will be required to provide to the Commonwealth for

long-term control.

– What the exact parking requirement is during construction (e.g. how many spaces need to be

provided for ongoing, on-site use).

• Over the next several months, DCAMM’s Office of Real Estate Management will work with the Office

of Planning and user agencies to better define these requirements, and test their impacts on overall

project economics.

8

Commonwealth Requirements

• Development capacity

– Zoning

– Preservation considerations

– Neighborhood concerns

– BPDA process

• Space requirement

– Replacement space for agencies currently at Hurley

– Space standards (per person, layout, etc.)

– Absolute maximum or minimum we would accept

• Term and tenancy of Commonwealth space

– Options to add / reduce Commonwealth space over agreement lifetime

– Space lease vs. leasehold condo vs. lease-to-own

– O&M requirements

• Budget for / interest in each of the following:

– No-cost space

– Low-cost space

– At / near market-cost space

9

Project Economics – for Further Analysis

• A Public Notice and Hearing Process will be conducted prior to submittal of FPP:

– Notice of Intent to Submit a Proposal and Public Hearing with an invitation for public comment

will be published in the Central Register and a local newspaper.

– A Public Hearing will be conducted in the legislative district where the Project is located.

– Written comments and public hearing comments, if any, will be considered in the

drafting of the Final Project Proposal and copies will be provided to the AMB.

• Notice of Intent to Submit a Proposal and Public Hearing with an invitation for public comment will

be sent to:

– The members of the General Court in the legislative district in which the project is located.

– The Mayor of Boston.

– The Boston City Council.

• Public participation will likely exceed the above requirements – as has been done successfully at

the Shattuck and Chelsea Soldier’s Home sites.

10

Notice and Public Participation

• Q1-2 2020: Due diligence, stakeholder outreach.

– Seek authorization from Asset Management Board to bring on redevelopment partner

• January PPP, July FPP

– Meet with neighborhood groups, preservation advocates.

– Define Commonwealth’s programmatic and financial needs for redevelopment.

– File Project Notification Form with MHC, begin consultation.

– Begin discussions with USDOL regarding federal equity.

• Fall 2020: DCAMM to begin formal process of identifying a redevelopment partner. Fastest possible timeline

after that point:

– 12+ months to designate a redevelopment partner (mid- 2021).

– 18+ months for partner to permit/finance (late 2022).

– 24+ months for partner to construct (early 2025).

• Late 2022: earliest possible date for building decommissioning.

• 2025: earliest possible date for state occupancy of redeveloped site.

11

Timeline

2019

Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4

Due diligence, stakeholder outreach

Identify redevelopment Partner

Permitting, financing

Construction

Move-in

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